Australia supports Economic Reform in Vietnam (Aus4Reform)

10/7/2018

About Aus4Reform Program

About Aus4Reform Program

1.Program overall goal and objectives

The overall goal of the Aus4Reform Program is to support the Partner Government in achieving its MPER goals of developing a more internationally competitive economy with increased productivity, reduced corruption and accelerated growth in employment and income. Aus4Reform will finance the costs of studies, consultations, peer reviews, and information dissemination on key policy issues identified in such resolutions, including reducing the regulatory barriers to business, introducing a new competition policy framework, approval and implementation of an amended competition law in line with international commitments, restructuring of the rural economy, improving women’s access to economic opportunities, and improving economic reform planning and implementation capacity.

 

The key strategic objectives of the Program are:

(a) An improved and more equitable business enabling environment resulting in the registration of at least 1 million formal private enterprises by 2020, including an increasing share of women-headed enterprises, and an acceleration in growth in private sector employment of men and women.

(b) More competitive and transparent product and factor markets facilitating the efficient transfer of factors of production (especially land) into more innovative and higher value added products and services, and reduced fragmentation of rural land holdings. 

(c) Stronger competition law institutions, including an amended competition law, and restructured competition agency and enforcement mechanisms.

(d) Improved evidence base on impact of efforts to accelerate rural restructuring, with stronger growth in the productivity of female and male rural workers.

(e) Increased evidence base and awareness of the links between WEE, reducing gender gaps in labour productivity, and accelerating productivity growth.

 

2.Program components 

Aus4Reform will achieve the aforementioned objectives through 4 components and a Flexible Fund with the following outputs:

(i) Component 1: Building more Competitive and Transparent Markets and a better Business Enabling Environment 

Central Institute of Economic Management (CIEM) under Ministry of Planning and Investment is the implementing agencies with the following outputs: 

- Monitoring and implementation of economic development and economic restructuring initiatives linked to new economic growth model (NEGM), including better understanding of progress and issues in implementing sub-national level reforms.

- Effective implementation of the Government of Vietnam actions plans to streamline the business enabling environment, including better understanding progress and issues in implementing sub-national level reforms.

- Increased and more broad - based support for reform agenda to develop competitive factor markets, with a focus on developing markets for agriculture land use rights. 

- Strengthen capacity to implement SOE restructuring, focusing on: monitoring and evaluation of SOE equitization; solving loss-making SOEs; SOE financial oversight; and increased transparency governance and accountability institutions.

- Recommendations for action to reform, restructure and improve public investment discipline and quality and to improve public service delivery institutions. 

 

(ii) Component 2: Ensuring Markets Operate Competitively in Consumer and National Economic Interests

Vietnam Competition and Consumer Authority (VCCA) is the implementing agencies with the following outputs:

- Amended competition law and reformed implementing institutions in line with international commitments and good practice. 

- Enhanced evidence base, information systems and skills to enforce competition agency responsibilities for regulating anticompetitive practices

- Proposed key amendments to the Law on protection of consumers’ rights.

- Enhanced evidence base, information systems and skills to enforce consumer protection responsibilities of the competition agency.

- Strengthened capacity to implement trade remedies in line with international economic integration agreements.

 

(iii) Component 3: Facilitating the Restructuring of the Rural Economy  

Institute of Policy and Strategy for Agriculture and Rural Development (IPSARD) is the implementing agencies with the following outputs:

- Recommended actions to mitigate adverse impacts of economic integration on rural economy based on credible analysis of bottlenecks.

- Promote agri-business development with tangible reforms in a selected province and/or value chain.

- Improved productivity and well-being for rural households in a selected province(s).

- Rural “coalitions” established in selected provinces and pro-actively advocating for reforms to increase value added and labour productivity in rural areas.

 

(iv) Component 4: Greater Business Voice in Implementing Economic Restructuring

Vietnam Chamber of Commerce and Industry (VCCI) is the implementing agencies with the following outputs:

-Increased business perspective in the monitoring and implementation of Government of Vietnam economic reform action plans (e.g. Resolution 19 and 35).

- More pro-active role of business associations in promoting women’s economic empowerment.

(v) Flexible Fund to Respond to Emerging Bottlenecks to Productivity Growth and Innovation 

 

3.Time and resource commitment 

Aus4Reform will be implemented between November 2017 and June 2021. The Government of Australia will contribute up to a maximum of AUD 6.5 million. Through its implementing agencies, the Government of Vietnam will provide such human resources, office accommodation and logistical support as is necessary to ensure the successful implementation of the Program.  Total contribution (in-kind) will be estimated up to VND 4.5 billion (equivalent ot 260,000 AUD). Besides, there will be contributions from private sector, mass media, enterprises, research institutes and communities mostly in the form of time spent on program’s activities.